Strategic control system facilitates in long-term success of the business organizations.Strategic management and control system:Dess et al., (2010) explained two diversified facets of strategic control system:· Informational control: Businesses evaluate environmental factors and respond to external factors with appropriate actions.· Behavioral control: Corporations evaluate their organizational culture, rewards systems and corporate boundaries in a systematic manner and try to create a positive balance between most important internal factors.
Traditional approach:Traditionally firms followed a linear approach where goals were set by senior management and then plans were implemented and overall performance was compared from predetermine goals. It was all single loop learning.Contemporary approach:Organizations are adaptive towards both internal and external factors. Organizations specifically emphasize on cross-functional approach, collaboration and integration among functional units along with the dynamic concept of knowledge management.A paradigm shift:Strategic control system is important in today’s era. It results into world class customer service, quality management, innovation as well as operational efficiency.
The demeanor remains with decentralization, empowerment and providing extensive career opportunities where benefits and rewards are awarded on reasonable and impartial bases. Organizations are focusing towards diversification and are adopting global and international strategies. Firms are undergoing joint ventures and acquisitions as a market entry strategy. There exist embedded boundaries in the form of unwritten standards, shared values and ethical code of conducts which results into sustainability and healthy organization. It further reduces monitoring cost and builds healthy culture. Organizations establish multiple reward systems based on based on objectives, behaviors, transparency and predictability, feedback and flexibility.
Organizational boundaries are set on the basis of following factors:- Individual abilities and priorities- Focusing on corporate goals and objectives- Highlighting the importance of both efficiency and effectiveness.- Eradicating unethical practicesMore importantly good corporate governance further enhances the organizational performance which makes proper investment and information and organizational security decisions. In today’s organizations both board of directors and management perform separately while focusing on their core functions. There also formal regulatory authorities and external bodies which an organizations has to follow.Conclusion:It can be concluded that strategic control is a broader perspective and it requires a holistic for an organization to adopt towards a proper strategic control system.
